Gartner Inc.
08/15/2022 | Press release | Distributed by Public on 08/15/2022 12:33
Relevance is customer and situationally specific
Relevance exists when buyer context or needs match seller solutions. Uncertainty reduces relevance upsetting prior matches as buyer context moves away from seller value proposition. Signs of declining relevance include:
- Sluggish sales pipelines
- Fewer new customers in that pipeline
- Longer sales cycles
- Declining buyer and customer engagement
- Reduced confidence in the sales teams to achieve their goals
Turbulence, uncertainty, and relevance
The current economic turbulence (inflation, interest rates, skill gaps etc.) raises uncertainty and reduces the relevance of current opportunities and commitments. Without relevance the signs emerge as customers question the validity of their plans and commitments. This represents the middle situation in the figure below.
I cannot or do not want to hear you!
Providers can be tone deaf to changes in context that reduce or eliminate their relevance to customers. If customers cannot see the value of your products and services, then you do not recognize a change in context. Tone deaf providers have resorted to one or more of the following strategies:
Blame the customer. If they cannot see the wisdom and value of our products, then perhaps they are not the right customer. The problem is we could go out of business if we cannot find the right customer, or the right customer does not exist.
Scare or confuse the customer. Create fear, uncertainty, or doubt - FUD to make your option the best way for them to not fall behind. This is classic trend marketing and hype management.
Educate the customer. We will invest in teaching them why our products and services are of superior value, fit the trends in the market and therefore should be a no brainer to buy. This is the Syms paradox, "where an educated consumer is our best customer." Too often the educated consumer recognizes a better alternative as the better understand their needs.
Offer a discount. If they cannot see the value then let's lower the cost until it matches their value. Besides creating a commodity trap, this strategy unnecessarily cheapens the product and your brand. Consider this example, do you really want to engage the cheapest company or their products in an important strategic initiative? Did not think so.
Increase sales incentives. Under the assumption that it's the sales teams fault that customers cannot see the value. People do what you pay them for. Give them more money, so they will work harder, convince customers and close business. Coffee is for closers after all, but too often this results in finding marginal business and lower quality revenue.
These and other approaches seek to prove the company is right and the customer at best uninformed. Such antagonistic practices create regret which Gartner found exists in too many high tech purchases. Instead of looking to make the company right, let's think about how we give the customer what they truly need - what is most relevant to them, their situation, their context, their values etc.
New Context, New Relevance, New Business
Relevance is contextually specific to each customer and their current situation. This is never truer than in times of uncertainty. Uncertainty reflects multiple forces, factors and changes creating turbulence that is open to interpretation. So, what is relevant is different for different companies. Paraphrasing Leo Tolstoy in Anna Karenina, "All successful companies are alike, but every challenged company is challenged in its own way."
New context starts with listening. Without listening it is doubtful you have enough understanding to make an effective connection.
Listening requires engagement, so proactively reach out to customers and prospects. Reach out to understand where things are rather than trying to position or sell them something.
Understand by thinking about what customers are saying, what they are not saying, the broader market context, etc. Understanding and empathy are the foundation for relevance.
Formulate messaging and communicate clearly in the customer's context. Speak plainly, offer examples from other customers, quantify your points where possible. Plan for a discussion not a debate. Remember, it is not just what you say, but how you say it, where you say it and what you expect from the customer that counts.
Relevance is not about finding the magic words
Building relevance is a conversation not a communication. Listen again and go through the process again to create the dialogue that leads to understanding. These are the essential elements of raising your relevance, particularly in times of uncertainty.
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